The rupee today endured a sharp reversal in fortunes against a resurgent US dollar after a two-day fall and recovered by 15 paise to end at 64.51 on fresh selling of the American currency by banks and exporters.
Besides, robust capital inflows and rallying local equity markets mainly supported the recovery.
Overall sentiment was largely optimistic ahead of the release of country's gross domestic product (GDP) data and core sector growth data, which are due after market hours.
Though, the movement confined to a narrow range.
The local currency opened firm at 64.55 from Tuesday's closing value of of 64.66 at the Interbank Foreign Exchange (Forex) Market.
It later gained further ground to touch an intra-day high of 64.49 in late afternoon deal before ending at 64.51, showing a smart gain of 15 paise, or 0.23 per cent.
The rupee had depreciated by 22 paise in the last two days.
The RBI, meanwhile, fixed the reference rate for the dollar at 64.5459 and for the euro at 72.1430.
In contrast to forex trading, domestic equities eased after four straight record-setting sessions on modest profit- taking amid scepticism over the recent rally and rich valuations.
Both the key indices Sensex and Nifty climbed another day of historic highs before retreating.
The flagship BSE Sensex declined 13.60 points to end at 31,145.80, while broader Nifty shed just 3.30 points at 9,621.25.
Meanwhile, the US dollar traded substantially weak despite soft inflation data from the world's largest economy amid cooling Fed rate hike fears.
The dollar index, which tracks the US currency against a basket of six major rivals, was trading lower at 97.08.
In cross-currency trades, the rupee recouped against the British pound to end sharply higher at 82.81 from 83.18 per pound and also rebounded against the Japanese yen to settle at 58.20 per 100 yens from 58.26 earlier.
The local unit, however, fell back against the euro to close at 72.38 as compared to 72.10 yesterday.
In forward market today, premium for dollar continued to display lacklustre trend owing to lack of market moving factors.
The benchmark six-month premium payable in October was soft at 125-126.5 paise from 125-127 paise, while the far forward April 2018 contract moved higher to 272.5-274.5 paise from 270-272 yesterday.
In the international commodity front, crude prices tumbled to a three-week low on Wednesday on reports that Libyan output was recovering from a technical issue at an oilfield, fuelling concerns that OPEC-led output cuts on reducing global inventories were being undermined by producers outside the deal.
The global benchmark Brent crude futures were down 2.5 per cent, at USD 50.56 a barrel in early Asian trade.